UNITED STATES DISTRICT COURT

MIDDLE DISTRICT OF FLORIDA

TAMPA DIVISION
UNITED STATES OF AMERICA
Plaintiff,

v.

Case No.: 8: 15-cv-

$2,761,910 IN UNITED STATES CURRENCY

Defendant.

VERIFIED COMPLAINT FOR FORFEITURE IN REM

In accordance with Rule G(2) of the Supplemental Rules for Admiralty or
Maritime Claims and Asset Forfeiture Actions, Plaintiff United States of America
brings this complaint and alleges upon information and belief as follows:
NATURE OF THE ACTION
1.

This is a civil action in rem, to forfeit to the United States of

America, pursuant to 18 U.S.C. 981(a)(1)(C) and Rule G(2), $2,761,910 in

lottery proceeds received from the World Triathlon Corporation ("Lottery
Proceeds") on the ground that the funds represent property which constitutes or
is derived from proceeds traceable to a violation of 18 U.S.C. 1955, or a
conspiracy to commit such offense. The Lottery Proceeds are thus property
constituting or derived from proceeds traceable to a violation of an offense
constituting "specified unlawful activity" (as defined in section 1956(c)(7) of Title
18) and subject to civil forfeiture to the United States pursuant to 18 U.S.C.
981 (a)(1 )(C).

JURISDICTION AND VENUE

2.

This Court has subject matter jurisdiction over an action

commenced by the United States by virtue of 28 U.S.C. 1345, and over an

action for forfeiture by virtue of 28 U.S.C. 1355.
3.

This Court has in rem jurisdiction over the Lottery Proceeds

pursuant to:
a.

28 U.S.C. 1355(b)(1)(A), because pertinent acts or

omissions giving rise to the forfeiture occurred within the Middle District of
Florida; and
b.

28 U.S.C. 1355(b)(1 )(B), because venue properly lies in

the Middle District of Florida pursuant to 28 U.S.C. 1395.

4.

Venue is proper in the District Court for the Middle District of Florida

pursuant to 28 U.S.C. 1355(b)(1), because the acts giving rise to the forfeiture
of the Lottery Proceeds occurred in this district.
5.

Because the Lottery Proceeds are in the government's possession,

custody, and control, the United States requests that the Clerk of Court issue an
arrest warrant in rem, upon the filing of the complaint, pursuant to Supplemental
Rule G(3)(b)(1). The United States will then execute the warrant on the property
pursuant to 28 U.S.C. 1355(d) and Supplemental Rule G(3)(c).
THE DEFENDANT IN REM

6.

The World Triathlon Corporation (WTC) delivered the Lottery

Proceeds to the United States on May 11, 2015. The Lottery Proceeds are

currently being held by the United States in the United States Marshals Service
suspense account.
7.

The WTC has entered into a Consent Forfeiture Agreement with

the United States. See Consent Forfeiture Agreement attached hereto as Exhibit
A. The WTC has agreed not to contest that the Lottery Proceeds represent

property which constitutes or is derived from proceeds traceable to a violation of

Title 18, United States Code, Section 1955, and that they are thus subject to
forfeiture to the United States pursuant to 18 U.S.C. 981 (a)(1 )(C). Exhibit A at

1f 3.

Additionally, WTC has agreed that it will not contest the civil forfeiture of the

Lottery Proceeds and waived its right to receive notice of this civil forfeiture
action. /d. Therefore, the United States will not be sending WTC notice of this
civil forfeiture action.
BASIS FOR FORFEITURE

8.

Pursuant to Title 18, United States Code, Section 1955, it is a crime

to conduct an "illegal gambling business." An "illegal gambling business" is a

gambling business that:
a.

Violates the law of a State in which it conducts business;

b.

Involves five or more persons; and

c.

Remains in continuous operation for at least thirty days; or

has gross revenue of $2,000 in a single day.

9.

Lotteries are prohibited by the Florida constitution. 1 The

constitutional prohibition is also codified in statute. Fla. Stat. 849.09. Generally,

a lottery is a scheme that contains three elements: consideration, chance, and
prize.
10.

Because the Lottery Proceeds represent proceeds of a violation of

18 U.S.C. 1955, they are subject to forfeiture to the United States pursuant to
18 U.S.C. 981(a)(1)(C). Under Section 981(a)(1)(C), the United States is
authorized to civilly forfeit any property that constitutes or is derived from
proceeds traceable to a "specified unlawful activity," as defined in 18 U.S.C.
1956(c)(7). "Specified unlawful activity," is defined in 18 U.S.C. 1956(c)(7) to
include offenses listed in 18 U.S.C. 1961(1), which in turn includes conducting
an illegal gambling business in violation of 18 U.S.C. 1955.
11.

As required by Rule G(2)(f), the facts set forth herein support a

reasonable belief that the government will be able to meet its burden of proof at
trial. Specifically, they support a reasonable belief that the government will be
able to show by a preponderance of the evidence that the Lottery Proceeds are
traceable to proceeds of an illegal gambling business violation.
12.

Specific details of the facts and circumstances supporting the

forfeiture of the Lottery Proceeds have been provided by Special Agent Lynn M.
Billings of the Federal Bureau of Investigation who states as follows:

Article 10, 7, Fla. Const.

FACTS
13.

WTC is a for-profit Florida corporation which was formed in 1989.

WTC is headquartered in Tampa, Florida and conducts business in the state of

Florida and elsewhere. WTC organizes, promotes, and licenses triathlon races,
including "lronman" triathlons, 2 in Africa, Asia, Australia, Europe, North America,
and South America. Each year in October, WTC holds the "lronman World
Championship" in Kailua-Kona, Hawaii. Since at least 2008, WTC has remained
in continuous operation and has employed more than five persons.
14.

Generally, athletes gain entry into the lronman World

Championship in one of four ways: by earning a slot at one of the over three
dozen qualifying WTC "lronman" events held worldwide (slots are awarded to the
top age-group finishers), by being selected in the "lronman Lottery," by being
selected in the "lronman Legacy Program," 3 or by winning a slot through the
"lronman World Championship eBay auction."4

An lronman Triathlon consists of a 2.4-mile swim, a 112-mile bicycle ride, and a 26.2mile run.
3
The Iron man Legacy Program grants 100 of WTC's most loyal customers the
opportunity to compete in the lronman World Championship. One hundred Legacy
winners are chosen by WTC based on several criteria. To be eligible for selection
through the Legacy Program, athletes must have completed a minimum of 12 fulldistance lronman-branded races, have never raced in the lronman World Championship,
have completed at least one full-distance Iron man event in each of the two previous
years, and be registered for a full-distance lronman event in the year in which they seek
to compete in the lronman World Championship.
4
The "lronman World Championship eBay auction" provides athletes the opportunity to
bid on one or more slots to the lronman World Championship. The auction is conducted
by lronman Foundation, Inc. The winning bids get an entry into the lronman World
Championship event. Each slot begins with a minimum bid of $10,000.

15.

The "lronman Lottery" began in 1983, as a way to provide athletes

who did not qualify the opportunity to compete in the lronman World
Championship. Each year since approximately 1989, the WTC has conducted
the "lronman Lottery," through which it has awarded athletes the opportunity to
compete in the lronman World Championship. 5 The 2015 lronman Lottery entry
fee was $50, and the lottery was used to award 100 athletes the opportunity to
compete in the lronman World Championship. 6 Slots for the Lottery Program do
not sell out, but an athlete can only register for the lronman Lottery once per
year. For an additional $50, however, athletes can purchase "membership" in the
"Passport Club" which offers an increased chance of being selected through the
lottery. If an athlete registers for the lronman Lottery and joins the Passport
Club, he or she receives two chances to be selected. By paying the Passport
Club membership of $50 per calendar year, athletes double their chances of
winning the lottery. 7

Prior to that year, the lronman Lottery was conducted by the Hawaii Triathlon
Corporation.
6
Winners of the 2015 lottery were afforded the opportunity to purchase an entry at face
value ($850) to compete in the lronman World Championship, subject to the condition
that the selected individual first completes another lronman-branded race leading up to
the lronman World Championship race.
7
In 2012, WTC changed the way it selected lottery winners. Beginning that year,
athletes gained an increased chance of being selected for the Iron man Lottery based on
the number of years that they had entered the lottery since 2004. For example, if an
athlete had registered for every lronman Lottery from 2004 through 2012, his or her
chances of winning a lottery entry to the lronman World Championship would have been
eight times greater than if he or she were registering for the first time. Additionally,
entrants were required to have consecutive entries, year-over-year, to maintain credit
from previous years.

16.

WTC represented to athletes that it was "unable to release exact

numbers" with regard to the number of people who register for the lottery or the
chances of being selected.
17.

The lronman Lottery contains the elements of consideration (an

entry fee of between $35 and $50, depending on the year), chance (winners are
randomly selected), and prize (the opportunity to compete in the lronman World
Championship). As such, the lottery violates Florida's anti-lottery law. See Fla.
Stat. 849.09. Additionally, since WTC has remained in continuous operation in
Florida since at least 2008, and has employed more than five persons during that
time, WTC has violated 18 U.S.C. 1955.
lronman Lottery Proceeds

18.

WTC received 10,939 entries for the 2013 Iron man Lottery, through

which WTC awarded 100 slots to the 2013 Iron man World Championship. Each
entry fee was $40. In addition, 4,337 individuals purchased a $50 "membership"
in the Passport Club which gave them a second chance of being selected
thought the Iron man Lottery that year. Thus, WTC received a total of $654,410
in Lottery/Passport Club entry fees paid to enter the lronman Lottery for the 2013
lronman World Championship. This $654,410 is proceeds traceable to a
violation 18 U.S.C. 1955 and subject to forfeiture to the United States pursuant
to 18 U.S.C. 981(a)(1)(C).
19.

WTC received 12,292 entries for the 2014 lronman Lottery, through

which WTC awarded 100 slots to the 2014 lronman World Championship. Each

entry fee was $50. In addition, 5,940 individuals purchased a $50 "membership"
in the Passport Club which gave them a second chance of being selected
thought the lronman Lottery that year. Thus, WTC received a total of $911,600
in Lottery/Passport Club entry fees paid to enter the lronman Lottery for the 2014
lronman World Championship. This $911 ,600 is proceeds traceable to a
violation 18 U.S.C. 1955 and subject to forfeiture to the United States pursuant
to 18 U.S.C. 981(a)(1)(C).
20.

WTC received 14,254 entries for the 2015 lronman Lottery, through

which WTC awarded 100 slots to the 2015 lronman World Championship. Each
entry fee was $50. In addition, 6,889 individuals purchased a $50 "membership"
in the Passport Club which gave them a second chance of being selected
thought the lronman Lottery that year. 8 Thus, WTC received a total of
$1,057,150 in Lottery/Passport Club entry fees paid to enter the lronman Lottery
for the 2015 lronman World Championship. This $1,057,150 is proceeds
traceable to a violation 18 U.S.C. 1955 and subject to forfeiture to the United
States pursuant to 18 U.S.C. 981(a)(1)(C).
21.

The "winners" of the 2015 lronman Lottery were announced on

March 17, 2015. Winners of the lottery are permitted to pay the $850 entry fee
for the 2015 lronman World Championship and participate in the race. So in

So in effect, there were 21,143 entries for the 2015 lottery (14,254 lronman Lottery
entries and 6,889 Passport Club entries). Thus the odds of a first time lottery entrant
being selected were less than 1 in 200.

2015, WTC made over $10,000.00 per slot it awarded via the lronman Lottery
(on top of the $850 registration fee).
lronman "Valentine's Day Lottery" and "Gift of Kona drawing"

22.

In addition to the generallronman Lottery, WTC conducted two

other lotteries in 2014: the lronman "Valentine's Day Lottery" and the lronman
"Gift of Kona drawing."
23.

The lronman "Valentine's Day Lottery" was used to randomly select

one winner who was given the chance to compete at the lronman World
Championship on October 11, 2014. The entry fee was $50 and athletes could
purchase as many entries as they wanted. Registration for the Valentine's Day
Lottery opened on February 5, 2014, and closed on February 14, 2014. There
were 1,352 entries in the Valentine's Day Lottery and one "winner." That lottery
alone grossed WTC $67,600. The lronman "Valentine's Day Lottery" contained
the elements of consideration (a $50 entry fee), chance (the winner was
randomly selected), and prize (a chance to compete at the lronman World
Championship). This $67,600 is thus proceeds traceable to a violation of 18
U.S.C. 1955 and subject to forfeiture to the United States pursuant to 18 U.S.C.

981 (a)(1 )(C).

24.

The lronman "Gift of Kona drawing" was used to randomly select

one winner of an opportunity to compete in the 2015 lronman World

Championship and a "VIP package for two people on race day." The entry fee
was $50, and athletes could purchase up to ten entries. Registration for the Gift

of Kona drawing opened on December 4, 2014, and closed on December 31,

2014. There were 1,423 entries in the "Gift of Kona drawing" and one "winner."
That lottery grossed WTC $71,150. The lronman Gift of Kona drawing contained
the elements of consideration (a $50 entry fee), chance (the winner was
randomly selected), and prize (a chance to compete in the 2015 lronman World
Championship and a VIP package for two). This $71,150 is thus proceeds
traceable to a violation of 18 U.S.C. 1955 and subject to forfeiture to the United
States pursuant to 18 U.S.C. 981(a)(1)(C).
25.

In total, WTC grossed $2,761,910 from the 2013 lronman Lottery

($654,410), the 2014 lronman Lottery ($911 ,600), the 2015 lronman Lottery
($1 ,057, 150), the "Valentine's Day Lottery" ($67,600), and the "Gift of Kona
drawing" ($71,150). This $2,761,910 is thus proceeds WTC received since
October 24, 2012 traceable to a violation of 18 U.S.C. 1955. Therefore, the
$2,761,910 is subject to forfeiture to the United States pursuant to 18 U.S.C.
981 (a)(1 )(C).
CONCLUSION

As required by Rule G(2)(f), the facts set forth herein support a reasonable
belief that the government will be able to meet its burden of proof at trial.
Specifically, for the reasons set forth above, probable cause exists to believe that
the Lottery Proceeds are traceable to proceeds of an illegal gambling business
conducted in violation of 18 U.S.C. 1955. Therefore, the Lottery Proceeds are
subject to forfeiture to the United States pursuant to 18 U.S.C. 981(a)(1)(C).

10

WHEREFORE, the United States requests that process be issued

against the Lottery Proceeds, in accordance with Rule G, to enforce the
forfeiture, and that any person or entity having an interest therein be cited and
directed to appear and show cause why the Lottery Proceeds should not be
forfeited to the United States for disposition according to law; and that the United
States have such other and further relief as this case may require.
Dated: May 12, 2015

Respectfully Submitted,
A. LEE BENTLEY, Ill
United States Attorney

4i

By:

JAiJlESA. MUENCH
Assistant United States Attorney
Florida Bar Number 472867
400 North Tampa Street, Suite 3200
Tampa, Florida 33602
(813) 274-6000- telephone
(813) 27 4-6220 -facsimile
E-mail: james.muench2@usdoj.gov

By:
Assistant United States Attorney
USA NO. 141
400 North Tampa Street, Suite 3200
Tampa, Florida 33602
(813) 274-6000 - telephone
(813) 274-6220 - facsimile
E-mail: natalie.adams@usdoj.gov

11

VERIFICATION

I, Lynn M. Billings, verify and declare under penalty of perjury, that I am a

Special Agent with the with the Federal Bureau of Investigation and pursuant to
28 U.S.C. 1746, I state that I have read the foregoing Verified Complaint for
Forfeiture in Rem, and the matters contained therein are true to my knowledge
and belief.
I hereby verify and declare under penalty of perjury that the foregoing is
true and correct.
Executed this 12TH day of May, 2015.

cial Agent Lynn M. Bill gs

Federal Bureau of lnve ation

12

CONSENT FORFEITURE AGREEMENT

The United States of America and the World Triathlon Corporation, through
the undersigned attorneys, hereby agree and stipulate as follows:
1. On or before May 8, 2015, the World Triathlon Corporation shall pay to
the United States $2,761,910 ("Lottery Proceeds"), representing the proceeds the
World Triathlon Corporation earned from its operation of lotteries 1 since October
24, 2012.
2. The United States alleges that the Lottery Proceeds were derived from
the operation of illegal lotteries, conducted in violation of Title 18, United States
Code, Section 1955, and are therefore subject to forfeiture pursuant to Title 18,
United States Code, Section 981 (a)(1 )(C).
3. The World Triathlon Corporation agrees not to contest that the Lottery
Proceeds represent property which constitutes or is derived from proceeds
traceable to violations of Title 18, United States Code, Section 1955, and that
they are thus subject to forfeiture to the United States pursuant to 18 U.S.C.
981(a)(1)(C), and it relinquishes any interest it might have in the Lottery
Proceeds.
4. The World Triathlon Corporation consents to the civil forfeiture of the
Lottery Proceeds, including the entry of a final judgment of forfeiture, and hereby
waives any right to further notice of-or to contest-any judicial forfeiture
proceeding against the Lottery Proceeds. The waiver to contest the forfeiture
1 These lotteries include the "lronman Lottery," the lronman "Passport Club," the
lronman "Valentine's Day Lottery," and the lronman "Gift of Kona drawing."

EXEHIBIT A

includes the waiver of any objection the World Triathlon Corporation may have to
the forfeiture, including, but not limited to, any objection that the forfeiture was
not noticed or commenced in a timely fashion or that it constitutes an excessive
fine.

All right, title and interest to the Lottery Proceeds shall be condemned,

forfeited and vested in the United States, pursuant to 18 U.S. C. 981 (a)(1 )(C)
and 18 U.S.C. 1955, free from the claim of the World Triathlon Corporation.
5. The World Triathlon Corporation agrees to unconditionally release,
hold harmless, acquit, and discharge the United States of America, the United
States' agents and employees, and all law enforcement agencies from any and
all claims, demands, causes of actions or suits, judgments, damages, losses of
services, expenses of whatever kind and description, that might exist by reason
of or arising out of the forfeiture of the Lottery Proceeds.
6. The United States Attorney's Office for the Middle District of Florida
agrees not to bring criminal charges against the World Triathlon Corporation or
its current or past shareholders, directors, officers, employees, or contractorsand to release, hold harmless, acquit, and discharge each such party from any
civil liability-related to conduct 2 that is both: (1) known to the U.S. Attorney's
Office for the Middle District of Florida at the time this agreement is executed and
(2) related to the conduct giving rise to this agreement.
7. Neither World Triathlon Corporation's signing of this agreement nor its

2 Which conduct includes operation of the "lronman Lottery" and the lronman "Passport

Club" since 1983, and the one-time operation of the lronman "Valentine's Day Lottery"
and the lronman "Gift of Kona" drawing.

forfeiture of the Lottery Proceeds in any way constitutes an admission of criminal,

civil or other wrongdoing.
8. The United States of America and the World Triathlon Corporation
waive any and all claims or rights that they have or may have, pursuant to 28
U.S. C. 2412 (the Equal Access to Justice Act) or otherwise, for attorneys' fees
or other costs involving the Lottery Proceeds arising out of the forfeiture action,
including the making of this agreement and the forfeiture detailed herein.

9. This agreement constitutes the final, entire, and exclusive expression

of the parties' agreement relating to the subject matter hereof, and supersedes
all prior or contemporaneous agreements, settlement proposals, negotiations,
and representations, written or oral, between the parties.
DATED: May 5, 2015.

A. Lee Bentley, Ill,

United States Attorney

Edward R. Sh hat,
Counsel for World Triathlon Corporation
Florida Bar No. 152634
Jones Walker, LLP
201 S Biscayne Blvd, Suite 2600
Miami, FL 33131

James A. Muench,
Assistant United States Attorney
Florida Bar No. 472867
400 North Tampa Street, Suite 3200
Tampa, Florida 33602

Assistant United States Attorney

USA NO. 141
400 North Tampa Street, Suite 3200
Tampa, Florida 33602